Segment Reporting and Revenue

6 Months Ended

Jun. 30, 2020

In operation of the business, our management, including our chief operating decision maker, who is also our chief executive officer, evaluates the performance of our operating segments based on revenue and gross profit. We do not analyze discrete segment balance sheet information related to long-term assets, all of which are located in the United States. All other financial information is presented on a consolidated basis. We have five operating segments and two reportable segments, real estate services and properties.

We generate revenue primarily from commissions and fees charged on real estate services transactions closed by our lead agents or partner agents, and from the sale of homes. Our key revenue components are brokerage revenue, partner revenue, properties revenue, and other revenue.

Information on each of the reportable and other segments and reconciliation to consolidated net loss is as follows:


	Three Months Ended June 30,						Six Months Ended June 30,
	2020		2019		2020		2019
Real estate services
Brokerage revenue	$	128,543	$	145,399	$	230,894	$	226,713
Partner revenue	6,506		7,447		12,791		12,023
Total real estate services revenue	135,049		152,846		243,685		238,736
Cost of revenue	88,799		103,616		182,361		184,399
Gross profit	46,250		49,230		61,324		54,337
Properties
Revenue	72,184		39,908		151,282		61,281
Cost of revenue	73,348		40,906		152,647		63,898
Gross profit	(1,164)		(998)		(1,365)		(2,617)
Other
Revenue	7,246		5,281		11,496		8,329
Cost of revenue	6,293		5,167		12,537		8,948
Gross profit	953		114		(1,041)		(619)
Intercompany eliminations
Revenue	(814)		(255)		(1,803)		(424)
Cost of revenue	(814)		(255)		(1,803)		(424)
Gross profit	—		—		—		—
Consolidated
Revenue	213,665		197,780		404,660		307,922
Cost of revenue	167,626		149,434		345,742		256,821
Gross profit	46,039		48,346		58,918		51,101
Operating expenses	50,465		60,767		120,774		130,972
Interest income	437		1,913		1,540		4,229
Interest expense	(2,665)		(2,153)		(5,109)		(4,290)
Other income (expense), net	43		36		(1,303)		128
Net loss	$	(6,611)	$	(12,625)	$	(66,728)	$	(79,804)

Revenue earned but not received is recorded as accounts receivable on our consolidated balance sheets, net of an allowance for expected credit losses. Accounts receivable consists primarily of commission revenue and proceeds from the sale of homes in-transit through the escrow process, and therefore it is not estimated. Based on the regulated environment in which we operate and the nature of our receivables, we do not expect material credit losses, and write-offs were immaterial in the periods presented.